At a minimum, we recommend that our clients review their existing estate planning documents every few years, and also when big life changes are happening. Going through a divorce is one of those times. Here are some things to consider when you are considering divorce or separation, and after your divorce is final:
- If a person dies without having their estate planning in order, Missouri’s law (or the law of whichever state they were resident in at death) of intestate succession will govern who inherits his estate. If that person is currently separated or in the process of getting a divorce, this may not match his personal wishes. If a person in Missouri dies while married (and, with a few exceptions, a person will be considered married until a divorce is final), the surviving spouse will receive all or a portion of the decedent’s estate under R.S. Mo. § 474.010. If the decedent had no children, the surviving spouse will receive the entire probate estate. If the decedent had children who were also the children of the surviving spouse, the spouse will receive half of the probate estate and the children will split the other half. If the decedent had children who were not also the children of the surviving spouse, the surviving spouse will receive $20,000 off the top, and then the remainder is split 50/50 between the surviving spouse and the children.
- If a person dies prior to his divorce being finalized and hasn’t updated his estate planning, the provisions in his existing estate plan, which likely include the not quite ex-spouse, will govern and the ex-spouse will inherit under whatever provisions were put in place while the couple was happily married.
- If a person dies prior to his divorce being finalized and has updated his estate plan to exclude the not quite ex-spouse, the surviving spouse has the right of election to claim a portion of the deceased spouse’s estate. In Missouri, under R.S. Mo. § 474.160, if the deceased had children, the surviving spouse would be entitled to one-third of the estate; if the deceased did not have children, the surviving spouse would be entitled to one-half of the estate.
- If a person dies after his divorce is finalized and does not update his estate planning documents, the ex-spouse, and all of his or her family members who are not still related to the decedent, will be treated as though they pre-deceased the decedent, both for purposes of being named a beneficiary and/or a fiduciary. Therefore, if the decedent still wanted the ex-spouse to be a trustee for their children, for example, the decedent would need to sign new estate planning documents after the divorce is finalized, naming the ex-spouse as such.
- Certain retirement plans require their beneficiary designations be updated to remove an ex-spouse as beneficiary, otherwise the ex-spouse would still inherit the plan after the divorce.
- Beneficiary designations on any life insurance or other “contract”-type property should also be updated after the divorce is finalized, to ensure that the agreement governing the asset doesn’t result in the ex-spouse remaining the beneficiary of the asset at the decedent’s death.
These are just some of the estate planning issues that should be considered when going through a divorce. These issues also don’t take into account any provisions of a premarital or post-marital agreement in which a spouse may have waived their statutory rights to inheritance, or any provisions of the divorce settlement agreement. In order to determine if you should consider these issues during and after a divorce, you should consult with your own estate planning attorney, who will be aware of facts specific to your circumstances.
Note: This blog post is also being published on the Missouri Bar blog here.